iPhone 6 Off to Strong Start, iPad Sales Hit 'Speed Bump'

Apple's new iPhone lineup is already paying off for the company, which reported positive results today and prompted Tim Cook to declare that he has "never felt so great after a launch before."

In the quarter ending Sept. 27, which included a two-week period during which iPhone 6 and 6 Plus were available to order and purchase, Apple sold about 39.3 million iPhones. That's up from 35.2 million during the previous quarter and 33.7 million from the same time period last year.

"Our fiscal 2014 was one for the record books, including the biggest iPhone launch ever with iPhone 6 and iPhone 6 Plus," Tim Cook, Apple's CEO, said in a statement. "With amazing innovations in our new iPhones, iPads and Macs, as well as iOS 8 and OS X Yosemite, we are heading into the holidays with Apple's strongest product lineup ever. We are also incredibly excited about Apple Watch and other great products and services in the pipeline for 2015."

During a conference call with reporters, Cook said Apple is working through a backlog of iPhone orders, a "huge" number of which are likely going to buyers who were waiting for Apple's larger iPhones before they upgraded.

"I would expect that to go on for some period of time because you have people that time out of contracts at different time," Cook said, though first-time smartphone buyers - and those making the switch from Android - are also likely part of the puzzle, too.

It's early days for the iPhone 6 lineup, though, so "it's going to take some period of time" before the full picture shakes out, but "I've never felt so great after a launch before," Cook said.

Earlier today, Apple released iOS 8.1, which activates Apple Pay on the iPhone 6 and 6 Plus. When asked about the business plan for Apple Pay, Cook said that Cupertino sought to create a service that provided ease of use, security, and privacy.

"Many people who have entered mobile payments are doing so in a way that they want to monetize the data that they collect from customers," Cook said, in a dig at Google. "We think customers in general do not want this; they want to keep that data private."

Apple does not charge participating merchants for using Apple Pay; instead, banks pay an undisclosed fee.

"We see it as an incredible service that is the most customer-centric mobile payment system that there is," Cook said. "We're very proud of it and can't wait to sign up more retailers and extend it around the world."

Slumping iPad Sales
As for iPad, Apple sold 12.3 million tablets, down from 13.3 million during the previous quarter and 14.1 million a year ago.

Cook acknowledged the "negative commentary" surrounding declining iPad sales, but he said Apple looks at iPad sales overall rather than in 90-day, quarterly chunks.

Overall, Apple has sold 237 million iPads since 2010, which is twice the number of iPhones sold during the first four years of the smartphone being on the market. Cook said Apple views its iPad sales numbers "as a speed bump, not a huge issue."

"That said, we want to grow," he said. "We don't like negative numbers."

One of the things potentially affecting iPad sales is upgrade rates. "People hold on to their iPads longer than they do a phone," he said. "We've only been in this business for four years, [so] we don't really know what the upgrade cycle will be for people."

But "people do respond to us doing great products, and we feel really great about what we did last week" with the launch of the iPad Air 2 and iPad mini 3.

"There are obvious cannibalization things that are occurring," he said, suggesting that some shoppers are probably choosing between an iPad or Mac and an iPhone and iPad. "I'm fine with that," Cook said.

"iPad has a great future," he insisted. "I'm very bullish over where we can take iPad over time, so we're continuing to invest in the product pipeline, [and] we're continuing to invest in distribution."

About the Author

Chloe Albanesius has been with PCMag.com since April 2007, most recently as Executive Editor for News and Features. Prior to that, she worked for a year covering financial IT on Wall Street for Incisive Media. From 2002 to 2005, Chloe covered technology policy for The National Journal's Technology Daily in Washington, DC. She has held internships at NBC's Meet the Press, washingtonpost.com, the Tate Gallery press office in London, Roll Call, and Congressional Quarterly. She graduated with a bachelor's degree in journalism from American University in Washington, D.C. See Full Bio